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tv   Bloomberg Daybreak Americas  Bloomberg  February 12, 2020 7:00am-9:00am EST

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romaine: jerome powell makes an appeal for fiscal policy, highlighting the difficulties the fed and other central banks are facing longer-term rates near zero. bernie sanders winning the new hampshire primary, trying to solidify his status as the standardbearer for the democratic party still split between progressives and moderates. and relief permeating global markets right now amid a slow down in the spread of coronavirus, but is the headline optimism obscuring a flight to safety beneath the surface? welcome to "bloomberg daybreak" on this wednesday, february 12. i'm romaine bostick, in for alix steel today. right now the price action is relatively positive. asia stocks started off the day shrugging off the impact of the coronavirus. we saw the bleed over into european stocks. the stoxx 600 at a record high right now.
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forfutures looking to hedge what would be a third consecutive day of record highs, so that worst case scenario for the coronavirus seems to be the narrative. futures lower, at not put a lot of pressure on the 10 year yield. currencies, we saw them gaining for a third straight day, led by the thai russian ruble. taking a look at euro-dollar on the bottom of your screen, $1.0911. yesterday we broke below $1.09 for the first time. lots of concerns about global growth, particularly with regards to some of that manufacturing data we got. brent crude a little bit of a rebound. should be getting updates from opec shortly with regard to their outlook for the oil market. time now for the global exchange, where we bring you today's market moving news from
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around the world. go from hong kong to london, new york, and to manchester, new hampshire. our bloomberg voices are on the ground with this morning's stories. we go to asia first, where the number of deaths from the coronavirus outbreak has now surpassed 1000 people worldwide. we go now to rishaad salamat. what's happening right now? there is some optimism out there. the epicenter of all this is hubei province in china. the number of new cases has fallen to the lowest in a month, or thereabouts. there are some signs of normality returning. to geteen people urging back to work and trying to sort out some of the industrial production numbers. no word yet from a swath of
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retailers the likes of yum. some of these companies have as many as 80% -- as many as 80% of their stores closed. some sporting events could be hurt. there's an event on april 19 that's under question. there's one of the biggest sporting events that hong kong actually does host. there was one worker who was showed signs of the coronavirus. there are deep cleanings taking place, and they are all working from home, as i just said. theof this coming ahead of budget next tuesday. we can expect some strong action
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there as well, similar to sars. the country is adjusting that this outbreak is actually worse than that in 2003. last time, they put us at one who did $66 million. expect that number to go much higher as well. all that as the economy suffers, which people anticipating as much as a 30% drop in tourism traffic. perhaps some light at the end of the tunnel, but who knows? let's get back to you. romaine: are things to rishaad salamat for that update. let's turn now to what has been happening with softbank. ceomy seo she some -- ceo mayau she some -- she some -- week that elliott management, the activist fund founded by paul singer, took a
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stick in softbank. that was operative to move because we have seen the value of softbank continue to trade at a significant discount to the size of its investment. the complaint from elliott is that the vision fund, softbank's billion cap -- softbank's $1 consumesapital fund, all of the oxygen when talking about softbank. when you see the hiccups they hiccup with perhaps an understatement, the size of the reaction was disproportionate. the message isits core businesst a buyback. if that core business is good, then softbank should back its vision by investing capital in that rather than in the new vision fund. masayoshi sonough
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is open to that. production fell 2.1% in december, putting the european central bank on high alert. laura cooper of mliv joining us now. reporter: european industrial production plunged in december, and it was 2.1%, slightly exceeding market expectations for a 2% drop. this is largely telegraphed ahead of time in individual country reports, but ultimately, it does set up for a disappointing fourth quarter gdp report on friday. the euros continues to struggle for a catalyst out of that $1.09 mark against the dollar given the growth headwinds ahead because the economy is struggling to gain traction, despite some more positive sentiment indicators for january. the ecb is going to be faced with these potential virus fears
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and they knock on effect to growth, so we are likely to see the euro struggle for some upside from here. elsewhere, we also had greek 10 1%, thet yielding lowest on record. this just reflects the search for positive yield within europe , and as well, the gradual return of normalcy for the economy after nearly a decade since the debt crisis. romaine: our thanks thereto laura cooper. opec releasing its monthly oil report, giving a forecast that appears to reflect some of the issues with regards to the coronavirus. the forecast for global oil demand, citing the hit to fuel use in china because of the coronavirus. for more, let's bring in helen robertson, who is joining us right now to help us break down the numbers. what are we seeing in this report?
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mentioned, as you opec has just produced estimates for global oil demand quite , so china is the biggest oil buyer in the world, and we have seen in a norm is hit from the coronavirus epidemic that's happened. what that has been doing is curbing the world's largest oil importer's consumption significantly, having a knock on effect on- knock on all sorts of suppliers. saudi arabia, the world's largest supplier, in particular. it has been creating downward pressure on prices across the board, so what is also happening at the moment is that the organization of petroleum exporting countries, along with key allies, which includes russia, the most important one, as we speak, they are in the middle of trying to decide whether they should continue or extend agreed oil production
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cuts. they had a meeting last week in vienna ahead of the scheduled .ne at the beginning of march a group of technocrats recommended that they extend already agreed production cuts by 6000 barrels a day. romaine: we are going to leave it there. are things to helen robertson -- our thanks to helen robertson. looney,eminder, bernard bp ceo, is going to speak with alix steel in an exclusive interview that is going to air at 12:30 p.m. eastern time, 5:30 p.m. in london. let's turn to what is happening in washington. fed chair jerome powell testified to the house banking committee, reaffirming a strong u.s. economy. the u.s.ell: we find economy in a very good place, performing well. we see signs of global growth bottoming out, reduced trade
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policy uncertainty. we see strong drop key asian -- strong job creation, all of those things. all of this happens in the context of a strong u.s. economy. romaine: joining us is michael mckee, bloomberg national economics and policy correspondent. what was the main takeaway yesterday? michael: the idea that the u.s. economy is in good shape because global growth is bottoming out, not so sure with news on industrial production out of europe and the opec oil numbers today. we will see if jay powell has a comment on that. he does return for a second day of testimony on policy, this time before the sena early, sayg the fed is monitoring what is happening there, but admitting the central bank doesn't know what the ultimate impact will be. what will be the effects on the of us economy? will they be persistent? will they be material?
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the fed just doesn't know. asked about the treasury bill buying, but he said was not qe, but an effort to make monetary policy were at a -- policy work better. the fed is just about out of ammunition, and he needs the senate and the house to do something about making fiscal policy available. the top line there is the yield curve in 2008, just before the fed began cutting rates. the bottom is the yield curve today. you can see there isn't much room to cut on the short end to bring the long and down. that is a point that jay powell is really stressing before memory of congress. we will hear more about that today, no doubt. vincent: be sure to state that -- romaine: be sure to stay with bloomberg today for more. that starts at 9:30 a.m. new york time. let's turn now to what happened
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in new hampshire overnight. a close victory for bernie sanders, who won the primary on tuesday. sanders lead with about 26% of the vote, beating out pete buttigieg with 24.4%. joining us from manchester's kevin cirilli, bloomberg's chief washington correspondent. a lot of momentum for bernie sanders, iowa and now new hampshire. kevin: for senator bernie sanders, it is on to nevada and south carolina after winning here in the granite state, and also for former south bend mayor pete buttigieg, another strong showing. but it is amy klobuchar who took third place, beating not only senator elizabeth warren, but former vice president joe biden. she now heads to new york city, get some tries to more fuel and cash for her campaign as she positions herself to a centrist alternative to people like buttigieg, biden, and bloomberg. for biden, it is to south carolina, where he says he has a
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south carolinian firewall that he says is going to help fuel him beyond south carolina and into super tuesday. romaine: bloomberg's kevin cirilli staying up late out there in new hampshire. coming up on this program, the sellers are bright half -- on this program, we are going to be talking about what is happening out there. stay tuned. from new york, this is bloomberg. ♪
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romaine: death toll from the 1001 coronavirus rising to hundred 15 people worldwide, with more than 45,000 confirmed 1115 people worldwide,
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with more than 45,000 confirmed cases. joining me right now is vassili serebriakov, ubs macro strategist. had a relatively severe reaction initially, but that has tempered a little bit. there seems to be this idea that even with all of these deaths and all of these cases, we still haven't quite reached the same level that we reached with sars with regards to the actual impact globally. if that still the case here? of people compare with sars. you must say that the size of china's economy and the emerging asia economy is much larger relative to the global economy now. china used to be below 9%, no closer to 20%. i think overall, in terms of the headline gdp numbers, global growth, i think you're going to see something really week in q1,
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which we haven't really seen since the great depression. that being said, the markets are forward-looking. this more a question of if isn't being contained, has my --d outlook really changed my asset outlook early changed? i think probably not so much. romaine: that growth track is what everyone is focused in on, but we have seen this divergence between what is going on in fx markets and what is happening in equity markets. you've got europe at record highs, u.s. stocks at record highs, and even asia bouncing back here. are we going to see a re-convergence between the fx markets and equities? us, the most undervalued markets are really commodities when you look at base metals as well.
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it is probably nothing best place to be. i think when it comes to equity markets, what we are probably going to see if sentiment rebounds is some catch-up in the asian markets. particularly, equities and china have been underperforming, so this is probably a catch-up trade in asia. when it comes to that, the dollar is stronger. not tremendously so, but it is stronger. our view that once we get back to the global growth picture being better, this is the dollar weakness of money comes out of the u.s. vincent: what do you make -- romaine: what do you make of the volatility we've seen? vassili: there is a very fundamental issue with the fx market. alsosafe haven currency is your highest yielding currency. that really keeps the markets stuck in this equilibrium of low volatility.
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if equities selloff, you are already long be safe haven. what you need to bring that -- to break that is better growth outside the u.s. that will take investors and move their money elsewhere. i think there's a little bit of surprise to the extent of the movement in the aero. our sense of positioning is quite short already, from both long-term and short-term investors. i think the aero is close to the bottom here. euro isur a -- the close to the bottom here. if you look at equity inflows into europe, they have been very strong, especially at the end of last year. we haven't seen those kind of equity flows since after the election in 2017. what is driving the euro lower is probably the carry funding, and that is really a function of interest rate differentials, but i think that short positioning could be sensitive and could be
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vulnerable if we see better growth around the world because we think european growth is rebounding as well, and european rates probably don't have that much more room to go to the downside. romaine: good stuff. sit tight. you're going to stick with us. coming up here on the program, we are going to speak with mark gold,w, ceo of barrick about the outlook for 2020. that's coming up next. this is bloomberg. ♪
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♪ romaine: shares of barrick gold are up in the premarket. the complete put out results, beating estimates. joining us from toronto is the ceo of that company, mark bristow. thanks for taking time to be with us this morning. congratulations on the number. talk to me about the production range and what we can expect
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over the next few years out of barrick. tok: as you know, we set out be one of the most valued gold companies and focus on value. what we have done is clean the company up. we've increased earnings, as you point out. most importantly, reduce the net debt by nearly 50%. we've increased dividends, which is important to give something back to shareholders, and we've got a five-year plan which , andnts a solid foundation that is a solid 5 million ounces a year for the next five years. we are going to be guarding the market 10 years without any report during march. romaine: you made some progress on the debt, net debt zero. when are you going to hit that? mark: that depends on how our program goes to clean up some of the non-core assets, and of course, if you consider the gold stays there if it
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for the rest of the year, we should get there by the end of the year. romaine: obviously, a lot of this is linked to the lower interest rates, weaker dollar, and some of the risks surrounding the election and other global issues. how confident are you that the current state of prices that we see right now in futures and the spot market is actually sustainable? capital atlocate $1200. we believe there's pressure on that number going forward. atbudget for this year $13.50, and of course, the gold price is substantially above that at this stage. plan anda between our today's gold price really drives our earnings for the next 12 months, effectively. romaine: do you think there is a significant short-term length between -- short-term link
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between gold prices and what you're seeing with regards to supply? mark: yes. for the first time in many years, since i was involved, we have seen a decline in gold production in 2019. we've all been guiding towards a peak gold period either this year or next year, and we are forecasting a 30% drop in gold by 2029. as you point out, the fundamentals that support the gold price are all well aligned as we speak today. but there's another one coming, and that is the supply side of the equation. romaine: last year, a big narrative in your industry was consolidation. are we going to see more consolidation in industry this year, and how the gay role, if any, -- and how big a role, if any, are you going to play in that? mark: we will look for
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opportunities to add to our tier one portfolio of assets. i'm completed focused on delivering a tier one standout organization based on quality and earnings potential. that is something come about i think we've got a lot of work for us for 2020, and we've got to be cut out to get our job done. romaine: mark bristow, great to have you. ceo of barrick gold there. coming up on this program, more on your morning trade and analysis of the markets in today's first take. that's coming up next. you're watching bloomberg. ♪ [ fast-paced drumming ]
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♪ romaine: this is "bloomberg daybreak." let's get a quick check of the markets here. another relatively positive day. we saw the start in asia, go into europe, and now s&p futures
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indicating what could potentially be a record day for stocks. dow futures also higher. csi 300, a lot more up to him as him trickling back into the more markets -- lot optimism trickling back into the asian markets. here to discuss it all, vincent cignarella, voice of the bloomberg macro squawk, damian sassower our, chief emerging-market credit strategist, and vassili serebriakov of ubs investment. be market reaction seems to saying this thing is slowing down. it is relatively contained. may be a hit on global growth isn't going to be so bad. i think i am going to take a look at the hit to monetary stimulus. we are looking for as much is 15 to 20 basis points
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cut, much steeper than what we have seen the last two times. we are also probably going to see another 100 or 200 basis points this year of rrr cuts. growthhe slowest rate of basically on record. there's certainly a lot they need to get right to get the economy back moving. vincent: if you look at the pboc come of that is all temporary. the markets are looking at this delayelayed production, of growth into the second quarter. all of the stimulus is lovely for the second quarter. in asiaers i talked to are basically saying, relax. in hong kong, we feel like we are getting towards the end of this. we have a handle on it. so is this idea that we are going to remake or catch up whatever was lost? vassili: there's always some you're not going to get back.
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there's always expenditure in consumption and tourism that is not going to come back, but overall, the markets are looking at it this way. the only problem is you're not going to get a lot of hard data until the second quarter, so you want to sit and hold the position and wait for that? a lot of traders will be singing twice about that. romaine: when you look at the fluctuations in the yuan prior to the coronavirus, we were above seven, down below. how do you read into that, and how does it feed into global flows? was the for us, seven equilibrium, so we are still sticking with that you. there's a lot of noise about the currency manipulator label and so on. fundamentally for us, the picture is not very supportive , but if global think does return, i you get those offsetting forces.
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damian: the real thing i am looking at is the absolute collapse in currency volatility. low in g7a 30 year vol. on a relative basis relative to testl, where i levels that the july 2019, when right before, we saw em fallout of debt. volnot saying to buy outright, but you want to build production into your portfolios. s&p,nt: we are trading doing this. i think you are right, the second half of this year there are a lot of things going forward. you got the trade picture with brexit, the trade situation with germany, but into auto tariffs, the u.s. election.
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it is really going to start to pick up. romaine: but why wasn't this enough to make it pickup? what happens down the road this year? why is that now going to be different? vincent: i think a lot of people were caught off base, looking for a weaker dollar, stronger emerging markets, better growth out of asia, less growth out of europe, a lot of growth potential he out of flata -- out of latam. all of that being a positive. all of that reversed with the virus and turned everything on its head. all of those trades unwound and with the runway. vassili: i think it sort of worked into the end of last year. the problem was you saw the , because you are paying negative carry. is just not worth
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holding short dollars. romaine: if we are talking about the dollar and the trajectory, we have to talk about the fed. we did hear from jay powell yesterday. he did address this situation. let's take a listen. chair powell: some of the uncertainties around trade have diminished, but risks to the outlook remain. we are closely monitoring the emergence of the coronavirus, which could lead to disruptions in china that spill over to the rest of the global economy. theine: when we talk about weakness or strength of the dollar, when things are bad, the dollar strengthens. when things are good, the dollar strengthens. what changes the trajectory? vassili: i think there's a limit here because the dollar has been strengthening because of concerns about the global economy, but guess who has the most room to cut rates? the fed. the fed comes into play, there's probably a limit, especially considering that a lot of other central banks are at the limit.
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romaine: powell yesterday was asked specifically. he threw water on that idea and seems to suggest that the fed might actually move to other measures besides cutting rates. damian: it is not just the fed. you heard it from lagarde. you heard it from dallas had president kaplan. 36 of them over the last year have seen curves flatten. if you look at the only eight countries that have seen their curves steepen on a year-over-year basis, one of the u.s. by a basis point, but the others are all em high-yield. if you do believe term compression is upon us, and you need to get some sort of high nominal yield by moving along the curve, you've got to look to em.
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vincent: i think a lot of people are going to get caught out again. just because dollar rates go up doesn't mean the dollar is going to go up. if we see the global economy pickup and fed is done, and the fed may raise rates, that is not necessarily going to mean a stronger dollar. it is going to be stronger export growth for em. you can see the dollar go down with higher rates. the carry trade is one function of how we trade affects. it is -- how we trade fx. it is definitely not the only one. that would be too easy. there are so many other factors that come into fx, which is why it is such a tricky game to play. you could see a situation where the rates could go higher for the rest of the year in the u.s. people think that means a stronger dollar, wrong. romaine: great stuff, guys. thus alisa ribicoff -- the silly surprise half -- the silly
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surprise half -- vassili serebriakov, vincent cignarella, you'll --sower, think thank you all. let's get an update on what is making headlines outside the business world. viviana hurtado is here with first word news. viviana: bernie sanders is now the undisputed leader of the democratic party's left-wing. the democratic-socialist winning the new hampshire primary with about 26% of the vote. he edged out pete buttigieg. he had a little more than 24%. now sanders is taking aim at the next state on the political calendar. sen. sanders: we are going to nevada, we are going to south carolina. we are going to win those states as well. [cheers and applause] viviana: amy klobuchar having a surprising strong third-place finish. elizabeth warren and joe biden
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both disappointing. they each finished in single digits. opec is feeling the pain from the coronavirus. forecast forashing global oil demand. the output has curbed oil use in china, and that leaves open facing a renewed glut. officials with u.s. reportedly accusing huawei technologies of being able to tap into mobile phone networks. according to "the wall street journal," those officials believe the chinese companies are using backdoors designed for use by law enforcement. huawei rejecting these allegations. the trump administration has urged allies to bar huawei from their networks. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm viviana hurtado this is bloomberg -- i'm viviana hurtado. this is bloomberg. romaine: coming up, we are going
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to talk about the roller coaster ride for japanese corporate in today's wall street beat. this is bloomberg. ♪
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viviana: you are watching "bloomberg daybreak." bitcoin appears to have decisively breached $10,000 for the first time since september. for the six day in a row, the digital currency rising, the longest rally since june. traders are setting their sights on the next resistance level. reportedly may post its first quarterly loss in almost 10 years, according to reuters. the reason, i drop in sales. production losses due to the
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coronavirus may also be a factor. over the next two decades, airlines in south asia will see 4500 new aircraft. the forecast underscoring the need for boeing to return to grounded 737 max to service. i'm the vr hurtado. that if your -- i'm viviana hurtado. that is your bloomberg business flash. romaine: let's turn now to wall street beat. first up, hedge fund popularity is fading, but that is not stopping fund managers from racking up cash. then, making the case for the loan market product. plan for son has a vision fund, too. joining us to talk about this is sonali basak. -- sonali: this is five
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managers bringing in $1 billion each. chase coleman has been very interesting because chase also invests in a lot of private market strategies, becoming more popular. romaine: that he beat the market? sonali: he did. romaine: ok, that's good. sonali: there are a lot of tiger cubs on this list. one of the more interesting people on this list who made a lot more than the prior year, but still made a hefty amount, made it to the top 15, is ray dalio, who did not make any money in his main fund, but his other strategy fared a little bit better. the question here is with so many trailing the market, people like hedge funds because they are diversifying, but this comes at a time when hedge fund fees have been under pressure for some time. i thing it shows what we have been seeing in the market. people really trust the biggest managers. there's consolidation in the
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industry, and you can stomach a ton of money if you are one of those main managers -- you can still make a ton of money if you are one of those managers. maybe that is the ticket. sonali: goldman sachs expense a $20 billion outflow this year from the industry. it's not just about what have clo's been, but what clo's will be. they can be product specific and not just a general representation of the loan market. the nice thing about structured products is they continue to evolve. it is the difference between buying a car on the lot or one with all of the special features. sonali: you've got to love financial machinations in the imagination of wall street. romaine: that never gets us in
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trouble, does it? sonali: right. well, this is an interesting story because clo's is something that is very hotly watched. wall street is already made a lot of money from the business, but what are clo's? they are packaged loans tied to low invest my grade companies. so by nature, they are risky. there are a lot of worries about people losing a lot of money. david moffat works for somebody buried -- somebody very interesting, the trader we know from "the big short" that bet against subprime mortgages. while they don't see systemic risk tied to clo's, he's saying there are pockets where you should be worried about risk. it is just that the industry itself can evolve. romaine: with regards to where we are with clo's today, it is not quite at the level where it was prior to the financial crisis, where you had that complete over leveraging that blew up. sonali: and clo's themselves
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ended up performing all right in the longer-term. the lack of losses there is what people hold onto. but who knows for next time around? romaine: let's talk about masayoshi son and softbank. they came out with earnings. they returned to profitability on at least one measure, but the big news is that scaling back the vision fund appears to be getting a few concessions here to paul singer and some of the concerns that activist investors are bringing. sonali: while they said they are constructive with singer, they are not saying they are going to do exactly what he wants, which is the $20 billion buyback. they don't want to do that very quickly. one thing they agreed on is we are trading well below our net asset value. did have a few positive things. we can take a listen to what aired a little bit earlier.
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>> i've learned a lesson from the past. at this moment, i believe we should plan for the smaller start for vision fund 2. romaine: we should point out his uber investment actually improved. not quite but people were expecting out of it. he did have some positive signs that the company is making good on some of those investments. he's always been a sort of swing for the fences kind of guy. sonali: that's for sure. there is still a lot of backing from wall street in softbank and its endeavors. not everything is good. is going to have to shut down, and e-commerce company, just this week. there are some troubles in the existing portfolio. let's see how they bring these two market because the public markets this year are not as forgiving as last year, which allowed some of these unprofitable companies to still go to market. romaine: and he got a bit of a boost from that sprint deal as
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well. that is going to remove some debt from the balance sheet, which seems to be a positive sign. sonali: so what is the new soft bank story? romaine: they can't just go back to being a telecom company. sonali: exactly. romaine: sonali basak, thank you. a tiny south korean hedge fund scored big at the oscars. the fund invested $500,000 in thedark comedy "parasite," surprise winner of the oscar for best picture. moviesd invests only in distributive by korea's cj group. i am guessing that percent will go up after this year. up, is this the best of growth behind us? we will take a look at the leading index in how the coronavirus outbreak could hamper global growth further. that is coming up next in today's trader's take.
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♪ vincent: time now for our trader's take -- romaine: time now for our trader's take. joining me is vincent cignarella. you can listen to vince by typing in on the bloomberg squa . what's going on today, leading economic indicators. vincent: i wanted to bring this back. the last time i thing we talked about the lei was the 1980's. but it actually does lead, and it leads the chicago national activity index, which then ,orrelates strongly with gdp and gdb correlates strongly with the 10 year yield. so you can flow through to where
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the economy is going and potentially where rates are going. that's we'veying been sliding since 2018, where growth has been on the downturn. by and large, we look like we are heading towards what is trend growth around 2%, not going to hit the famous 3% kudlow targets for 2020. romaine: obviously you have the big dip in recession, but when you compare that to leading up to the financial crisis and that dropped, you're really not seeing that fall. vincent: and that is the point. we may see it dip a little bit more for the first quarter this year, virus effects, but what we this push forward of growth into the second quarter. i think the lei is going to turn higher. it will lead the activity index and gdp. romaine: there are some folks, including some strategists, that
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say some of the positive data we are getting on manufacturing could be a little bit of a head fake, may be obscuring a little more trouble. vincent: i think when you look back at 2019, when the trade situation was still hot and ,eavy in the third quarter before we got the delays, when the trade war was delayed and pushed forward, it brought a lot of manufacturing inventories into the latter half of last year, away from the first quarter. a little bit of build up people expect it to unwind. that situation has passed. i think now you see an inventory rolloff, and that needs to be rebuilt. whether you have strong growth or not, you still have to have product on the shelf. i think that is going to carry us into the second quarter. romaine: and with regards to the coronavirus, that is just going to be transitory? vincent: the folks i talked to
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in asia feel really good that the effects are slowing. it seems to have less effect on markets than in the past. i think we are going to rolloff the virus and into the presidential elections as for the next big key for markets. romaine: always great to get your thoughts. coming up on this program, paul brain, newton investment management head of fixed income, joining us to talk about not only what is going on in fixed income, but also the market as a whole. as we head towards the beginning of the cast trading day at 9:30, s&p futures voting where they of the cash trading day at 9:30, s&p futures holding where they have been. all of this started over in asia. the csi 300 up 0.8%. the stoxx europe also hit a record high on the day. 10 year yield not going anywhere, 1.60%.
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crude getting a bit of a bid here. gold just flatlining. your currency of the day, looking at the kiwi. from new york, this is bloomberg. ♪ when it comes to using data,
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it's wireless reimagined. simple. easy. awesome. ♪ romaine: welcome to "bloomberg this wednesday,
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february 12. i'm romaine bostick, and for alix steel. let's take it from the top -- romaine bostick, in for alix steel. let's take it from the top. jerome for fiscal policy to support the economy. michael: the fed is just about out of ammunition, powell said, and he needs the senate and the house to do something about making fiscal policy available. highlightis comments challenges central banks face with short and longer-term rates near zero. sen. sanders: we are taking on billionaires and candidates funded by billionaires. romaine: bernie sanders wins the new hampshire primary, sending challenges -- fending off strong challengers. kevin: it is onto nevada and south carolina from winning here integrated state.
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took third place, beating senator elizabeth warren and former vice president joe biden. romaine: the challenge now, whether sanders can cement himself as the standardbearer of a democratic party split between progressives and moderates. >> coronavirus could have an impact of anywhere from 300,000 barrels a day to 500,000 barrels a day, which will soften demand up and lead to opec. forecastspec slashes for output demand. >> china is the biggest oil buyer and the world, and we have seen a hit from the coronavirus epidemic, curbing the world's largest oil importer's consumption quite significantly. returns tod softbank profitability, but questions remain about some of my you she some -- some of my seo she some
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-- some of must liu she's on -- son'sf masayoshi freewheeling bets. he said he would open the door to working with activist investor paul singer. let's get a quick check of what is happening in the markets right now. seeing a little bit of a sigh of relief with regards to the coronavirus. that may not materialize. asian stocks shrugging it off. we are seeing that bleed into s&p futures, looking to set up for their third consecutive record day here. should also point out in the treasury market, not a whole lot of activity. we saw japanese bonds get pushed down a little bit. that put pressure on the u.s. 10 year yield. brent crude up a little higher here, and as far as the currency picture, em currencies is the story of the day, up for a third straight day. euro lower.
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joining us for the hour come up sutherland -- joining us for the hour, brooke sutherland. this was the big news overnight. people wanted to see how he would respond to a lot of the criticism. brooke: he said he is making changes come but in the presentation, there is a lot of the pomp and circumstance would come to expect. he talked about the tide turning, and made a lot of positive noises on some of the demands that elliott has made of the company, including increased buybacks, increased transparency, adding directors to the board, but the devil is in the details. we don't have a lot of those details. what does it mean that we get more transparency on some of these investments in the vision fund? how detailed are they actually going to be? he talked about buybacks as may be a sometimes event. is sometimes right now, a few years down the road? romaine: is this a more disciplined company? people don't buy into softbank and the vision fund for discipline. brooke: no, not really.
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they are having a hard time getting outside investors, but he is calling it a bridge fund, and that they might get this buton 2 fund down the road, there's a lot of skepticism, and he's going to have to prove himself all over again because people have not forgotten wework. romaine: in the meantime, stocks around the world gaining ground, bonds edging lower, all because of signs that the spread of the coronavirus may be slowing down. for more, we are joined by paul brain, newton investment management head of fixed income. thanks for being with us. a lot of the concerns that we had in this market about the coronavirus, specifically the effect it was going to have on global growth, the sentiment now seems to be that the hit on global growth they not be that much, and whatever does occur, that will be made up in due time. paul: i think that has been the general impression, that it is a temporary hit. inflation expectation will drop a bit, so flay sherry expectations are coming through
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-- so deflationary expectations are coming through. high-yield has not sold off very much in the wave of speculation about weak economic growth. it is just people looking for the opportunity to perhaps reinvesting risk assets. brooke: if you talk about a temporary hit, does that still mean china can hit that 5.7% gdp target that economists were talking about before this happened? paul: it's going to put them back. it's depends on how long this virus has an effect. the year on your numbers are bound to be affected for more of thought.then we first does that mean we recover more strongly over the next 12 months? i think it is more likely. the amount of liquidity and support will have an effect once the virus starts to have a lessened effect. romaine: the rebound we have
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seen across markets not only in the u.s., but we are seeing european equities near record highs, seeing a pretty significant rebound in asia, there is a sense that you had to have a lot of courage to stay invested in this market over the past few weeks. where is that courage coming from? what is underpinning that? paul: i'm not going to say stupidity, but i think it is more about what else do you do with the money. we have been living in this low interest rate environment for so long, and in europe we are experiencing negative interest rates, so what do? -- what do you do? are yields, bond spreads extended. it's hard to spot right now. these black swan events are always difficult to spot ahead of time. if we go back to where we were the beginning of the year, we
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were thinking about benign interest rate environment, yield curves gradually drift up because we are not going to see further rate cuts. but that is not going to cause a significant problem for risk assets what we saw in 2019. think what we have to look for perhaps into 22 anyone, we are looking at fiscal expansion that could then cause pockets of inflation if it gets out of hand. and that may derail the markets further down the road. romaine: where's fiscal expansion coming from globally? paul: it is all talk. wherever we see elections, weather here in the u.s. or in europe, there is more talk of where we could spend more. in germany, there's a shift towards spending, either towards the right or left, but clearly, the politics are diverging from the middle to the wings. to get elected, people have to promise to spend. we will see more borrowing, and more spending. , the spending has just
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been slippage. deficits are a bit higher this year than last year, and will be a bit higher next year, so it is not out of control next, but if politicians want to be elected, what are they going to do? brooke: there's also been talk about the fed may be reevaluating some of its framework, whether that is average inflation targeting or perhaps something markwest of. what do you thing about that? is that the right shift for the fed to take? paul: i think it is a logical shift. if you target a top number, like a in this environment, changes are you are going to be somewhere below that. targeting an average of around 2%, which means the top could be 3%. that makes sense if you are trying to get inflation back into the system. with the amount of debt we've got worldwide, we need inflation to eventually wear that debt down. romaine: where does that come ?rom, though
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there's no real expectation for inflation anywhere near targets. paul: the problem with that idea is we are in financial repression, which means you have to have interest rates below inflation for a long time. ,nless you write off the debt the central bank will go for it. that is why we are not too concerned about it. ofyou see it on the back , it is not going to be that big a problem. romaine: sit tight. there's a lot more willing to talk about with you. up, bernie sanders edging out a victory in the new hampshire state primary. we will talk about that next. this is bloomberg. ♪
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romaine: senator bernie sanders taking the top spot in the new hampshire democratic primary, fending off strong challenges from pete buttigieg and amy klobuchar. kevin cirilli is still in manchester. it wasn't a surprise that bernie sanders won. what was a surprise was how well amy klobuchar does. kevin: precisely. senator klobuchar says she's going to go to new york city later today to meet with democratic presidential donors. her strong showing in the state of new hampshire last night, then a third-place finish, beating elizabeth warren and former vice president joe biden. she is hoping it will fuel her as a centrist alternative choice as this primary season heads to
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the nevada caucus and south carolina primary. brooke: in terms of looking forward at the ramifications of this, does bernie sanders really emerge as a leader, or do you look at the split between buttigieg and amy klobuchar? does that's just there is a room for a centrist to take the lead here? kevin: there is this notion that has developed that senator sanders, percentagewise, wasn't able to beat when you combine the other candidates, all of the centrist candidates. that is true, but as one sanders supporter put it to me, if you stuck up all of the other candidates and add up their percentages, biden didn't even come close to being able to take them on. there's a lot of candidates running, including former new york city mayor michael bloomberg, who will no doubt be an even more outside force in this race, so there's a lot of questions, but if you look at
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iowa, as well as the new hampshire contests, what that shows is that there is momentum for former south bend mayor pete buttigieg, as well as senator sanders. romaine: of course, we should mention that michael bloomberg is the founder of bloomberg lp, which is the majority owner -- parent company, excuse me, of bloomberg news. for more on the political risk around the markets, we want to bring paul brain back into the conversation, newton investment management head of fixed income. paul, there is a sense that on re is a push and pull between the far left progressive tight candidate who would rewrite a lot of social programs and spend in a way that some people aren't comfortable with come about at the same time, we had a republican administration that seems relatively comfortable in spending on the things it wants to spend on.
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is it really going to be much difference for the markets if we end up with a republican administration versus democratic, based on the field out there? paul: the quick answer to that is probably yes, if the socialist spending program gets too out of hand. go?far does it that will be seen as a significant change from what we are seeing right now in terms of spending plans for the markets. i think we are seeing it in other countries as well, the shift towards the more extreme social agenda, and also more extreme market agenda, between the left and the right. we have seen in some elections through europe and the u.k., ultimately the socialist agenda is nice to have, but in reality, it is the more market faced agenda that tend to win through in the end. brooke: one thing i thought was interesting, pete buttigieg brought up the deficit. this has typically been a taboo issue for the democrats, but it is something we have heard from
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the federal reserve, from investors. how much of a concern is this? paul: given that yield levels, given where the market is, it is not really a concern at all. the deficit has increased truman to sleep under trump, but is it serviceable -- increased under , but is itndously serviceable? look at japan. it has been under massive deficit for some time. romaine: that is the argument, that as long as you can service the deficit, it doesn't matter to the same degree as some other countries that are not in the same position. when you look at what is happening in the u.s., what happened in japan, and even what people see in europe, assuming they can work things out, is this the future in the short to midterm, that we are just going to have to get used to higher deficit spending? paul: you will have to get use to fund managers coming on your
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tv and talking about debt all the time. romaine: good for you, though, right? paul: good for me. i'm happy about that. there's no alternative at the moment. spending in the deficit is going to have to go up. this is a low growth environment with low interest rates, and a very fragile growth environment. as we have seen with the virus, it can be tipped into negative territory barely quickly. if you are in charge of your own currency, you can afford it. just to tip it back to the election, we have seen the equity markets and the bond markets in general be pretty immune to the different swings in terms of the candidates. at what point does the start to metta for markets? are there -- start to matter for markets? are there pockets where you are seeing more reaction? paul: health care is one where it affects the companies involved. starting to beis
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affected by where that money comes from, etc. so the corporate bond market is going to be more moved by a socialist agenda, definitely. in general, the market would have to price in some sort of socialist premium into the bond market. we are seeing that in other countries. but like i said at the beginning, it's not as much as it used to be. in days gone by when we had inflation and big shifts in had very agendas, we big shifts in yield, but it is not is because it used to be. romaine: your outlook for those interest rates? some people look at the fed and say there is a move here to at least try to raise inflation expectations and presumably raise rates. just changes that the shape of the curve a little bit. i don't think it changes the fed funds rate.
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capital still providing and still expanding balance sheet. there is still liquidity available. but a pickup in inflation expectations will steepen the curve modestly. . not looking for a big move, but we would expect the curve getting back to a more normal shape, rather flat. that means 2% on the 10 year. that is not a big move from here. romaine: sit tight, paul. all brain, newton investment head of fixed income, will stick with us once again. we will talk about how blackrock's new climate focused etf is already paying off despite only starting trading on friday. from new york, this is bloomberg. ♪
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viviana: this is "bloomberg daybreak." more problems with startup investments at japan's softbank group, losing money again in its
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vision fund one quarter after softbank posted record loss driven by the meltdown at wework. the vision fund losing more than $2 billion in the three months ending in december. nissan isn't done going after former chairman carlos ghosn. ghosn inaker has sued japan to try to recover monetary damages he infected on the company. mr. ghosn was arrested in 2016 on charges of financial wrongdoing. at the end of december, he made a dramatic escape to lebanon. blackrock announced last month that it would put climate change at the heart of its strategy. that pledge already paying off. a blackrock sustainable etf has attracted more than $300 million it only started trading on friday. that is the best debut for any u.s. etf this year. that is your bloomberg business flash. romaine: still with us here around the desk, paul brain of
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newton investment management, and brooke sutherland of bloomberg opinion. we have seen a lot of money flowing into these esg investments. brooke: i would love to get your thoughts on this, paul. esg?really counts as do you have to make sacrifices on that front to ensure liquidity? paul: certainly, we do have to be an active investor when it comes to choosing companies, and also countries, with good esg scores. we think it is worthwhile to do that. with to get mix a difference in terms of performance over the long term -- we think it makes a difference in terms of performance over the long term. we think there is a lot of money going in this direction. we have been launching a range of sustainable funds the last three or four years, and one of our six funds last year was one of the fast earning funds we have had. there's definitely a trend in this direction, and we think if you do the right work in the then i thinkerly,
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you can make a difference with the capital you are employing. romaine: do you think this is a trendline where we get to a stage where everything , --ctively comes esg? effectively becomes esg? paul: if you think of what esg has to be, what that means and how you define that is important. but the environmental bit has become much more important the last 18 months. that is the thing that is actually determining company profits and how sovereigns will allocate their capital on the development they do. define,rt is harder to but certainly we are seeing influences come through in that area as well. brooke: what sort of things are you looking for? paul: the easiest is do they fit easy --he -- well, not
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but if you were to stress the company business model on the two degree world idea, will they continue to pay the coupons and the printable going forward? you can do the same analysis with sovereigns. the type of environmental change, the type of revenue perhaps they get from climate change or from carbon, good carbon or bad cop and -- or bad carbon, all of this analysis is probably worth doing. be a lot ofrobably carbon that is considered to be worse than others. it is a subtle change, but certainly worth doing. brooke: when you say to degree world, you mean a world that is two degrees warmer? paul: more than, yes. and we may revise that over the coming years. but at the moment, that is the starting point. romaine: paul, stick with us.
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paul brain of newton investment management. we will get some of your other thoughts a little later. we are counting down to day two of fed chair powell's testimony in washington. this is bloomberg. ♪
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romaine: this is "bloomberg daybreak." i am romaine bostick in for alix steel. a risk on day around the world. the stoxx 600 holding your a
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record high. now s&p futures set up for your day in the u.s. for u.s. stocks, potentially another record high. not a whole lot going on in the treasury market. seeing pressure on treasury prices. 1.62 is where we are at. crude getting a bump and bold is down. the outperform are on the day is the new zealand dollar pair. quite a bit of a ride. economy,n to the u.s. specifically jerome powell. he testified to the house financial services committee yesterday, reaffirming the strong u.s. economy. we find the u.s. economy in a good place, performing well. we see signs of global growth bottoming out, we see reduced trade policy uncertainty. overall we see strong job
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creation. all of this happens in the context of a good, strong u.s. economy. romaine: joining us is michael mckee, bloomberg international economics and policy correspondent. still with us is paul brain. the same line we heard from jay powell. what back up that statement? michael: he is using the data that had been coming in until this morning. with the industrial production numbers in europe being so dismal and opec scaling back dramatically its oil demand or cast, you have to wonder if his assertion that the global economy is bottoming out is actually going to come true. maybe he will get a question about that today. the u.s. economy has been in relatively good shape. not growing gangbusters but not looking at recession. we do not know what will happen with the coronavirus. the forecast is steady as she
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goes. can we have a lot of confidence in that? that is a lot -- that would be one of my questions. michael: -- brooke: when you look at those data points and the mention of coronavirus, you see another interest rate cut in the future? paul: i would not rule it out. we got a short-term shock to the data, we have numbers that will be significantly lower because of the virus, and there's a chance central banks may need to respond. given that the markets are trying to look through that and look to the point where they're starting to recover again, i think it is less likely we will see that response i would not rule it out. brooke: you talked about the growth being fragile. what does that recovery look like if it does occur? beingthe reference to it fragile is we have had a long period of loose monetary policy and we still have weak numbers in europe, slowing growth coming
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through in china. it is only the u.s. that has been doing ok, and the u.s. has been doing that in the backdrop of fairly low interest rates. it does not take much to push all of those numbers into negative territory. romaine: one thing jay powell talked about yesterday was the fed's mandate and what type of change, if any, they will make. we know there is a review going on. do we get any more clarity? michael: they did not ask about the review. there were a lot of questions about why doesn't the fed bailout this part of the economy or that part of the economy? a congresswoman from detroit asked why didn't you buy municipal bonds in detroit? that is where you got the mandate. jay powell said we are supposed to provide maximum employment and stable prices. we are not supposed to take
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parts of the economy and build them up. a lot of people looked at what happened in 2008 and said you went beyond your mandate. there presley from massachusetts and there did not seem to be consensus. michael: we do not know how low unemployment can go. the fed has always gone that if you bring down unemployment far enough you get inflation and they try to balance the two. it does appear they can go lower than they ever thought and jay powell said that. we have changed our minds. we thought until a couple of years ago we cannot do that, but we are not seeing inflation, so we are letting unemployment continue to fall. brooke: what you think it takes to see inflation? are we in a structurally deflationary environment? post-2008 we are and we
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don't write off the debt you will have lower interest rates. we are stuck in that environment. the fact that we do have a global supply chain, a global manufacturing chain, a lot of the previous models do not work because a lot of the manufacturing is done somewhere else. if you have less than full employment and other places like china, and there is an abundance of employment still coming through, then you will have deflationary pressure. romaine: great to get your thoughts. paul brain, thank you to you and bloombergs michael mckee, an international economics and policy correspondent. we want you to stay with bloomberg later today. full coverage of date two of jerome powell's testimony on capitol hill. that will start at 9:30 a.m. new
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york time, 2:30 in london. let's get an update on what is making headlines outside the business world. viviana hurtado is here with the first word news. viviana: we begin with bernie sanders, now the undisputed leader of the democratic party's left-wing, the democratic-socialist winning the new hampshire primary with 26% of the vote. he edged out pete buttigieg. now mr. sanders is taking aim at the next date on the political calendar. senator sanders: we are going to nevada, we are going to south carolina, we will win those states as well. viviana: amy klobuchar had a surprising strong third-place finish at 20%. elizabeth warren and joe biden both disappointed. they both finished in the single digits. opec is feeling the pain from the coronavirus. the cartel slashing forecasts for global oil demand. opec facing a
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renewed glut despite recent production cuts. produce projections for demand growth. accusing huawei technologies of being able to hack into the phone network. chineses believe a company uses backdoors designed for use by law enforcement. while way rejecting these accusations. while way rejecting these accusations. the trump administration has urged allies to bar huawei from their network. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am viviana hurtado. this is bloomberg. romaine: big tech under scrutiny. the ftc announced it will -- forine the positions more, let's bring in avery from washington.
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,lso with us is adam holler avery, i will start with you. this news the ftc was not only reviewing a lot of transactions but specifically focusing on smaller deals that some people refer to as catch and kill were a big company buys up a small company to eliminate the competition or poach their talent, what you make of this? does this have any teeth? great use ofs a ftc power. an antitrust we look for enforcement. this is different. the ftc is unique in that it has the power to do an investigation without a law enforcement objective. what they are doing is trying to understand whether there is a pattern and practice among these companies of doing catch and kill, making small transactions below the threshold that has to
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get reported to the federal government, which is about $90 million, and if they are doing that, than the ftc would move to the next phase of what are we going to do about that problem? adam, what does this do to the m&a environment, does this have a chilling effect when you look at big tech companies and the startups? adam: it is a great question. that is what all of the tech companies we are talking to are trying to figure out. m&a is an important part of the growth story protect companies. we see that continuing. the shift in regulatory focus on tech m&a is real and they will have to think a little bit reverently -- a little bit differently about their m&a approach. i think there are valid reasons why tech companies are looking at acquisitions and smaller acquisitions that can be good for consumers. they have to factor in longer
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regulatory review times and be more flexible in the target they look at. the ftc focus is real. brooke: what does it mean to look at some of these smaller deals? does the ftc want to be in the business of predicting which startups will be viable in the future? that is not what the ftc wants to do. they want to make sure they are doing what is right for consumers. tech is a challenging place to do that because the traditional means by which the ftc looks at competition are different in tech. that is because it means these small companies, that is where the innovation is happening, and the disruptive innovation allowed companies to grow quickly. it is also a place where market share, largely defined by revenue, is what defined the
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means of competition. in tech that is not always right. sometimes it is daily active users that are better sense of what defines competition. the ftc is trying to find out ways they can better set the bounds of competition and ensure the right acquisitions that are good for consumers are happening. things that create more integrated solutions and pull together more growth opportunities. avery, i want you back in the conversation. we saw market reaction that was somewhat pessimistic with regard to the large-cap tech companies. there is a fear this could lead to a rollback of some of these acquisitions. will that be the case? are we really talking about retroactively going back and pulling apart some of the companies? avery: hard to do that. the bigger concern is there'll be a tax placed on transactions i some of these companies.
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you might have to pay more if be purchased by one of the tech giants because of the concerns the agencies will scrutinize those transactions more closely. it may make it easier for smaller companies to eat up some of the startups they have been priced out of before, because they will not have the same concern on an extra regulatory attack on the companies that are not in the crosshairs of the ftc current negotiation. at others i look industries -- you look at boeing and how much control it has over the aerospace sector. does this eventually go into other parts of the economy where we are rethinking antitrust? avery: it is a great question. every company in america is now a tech company. we will see this expand to include places like boeing and the aerospace industry and certainly pharmaceuticals.
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there is strong evidence and pharmaceuticals that big companies dubai up stronger competitors in order to kill development. that is a significant concern. , what advice would you give to a startup right now? would you tell them to wait this out? adam: startups should keep their head down and focus on innovating and doing what they do best. game and that is what they do well. keep at it. romaine: our thanks to avery gardiner of the center for technology and democracy and adam gardner -- adam haller of bain and company. and thanks to brooke sutherland. you will stick around. don't leave me yet. it is hard without alix here. coming up, we will talk about the brooke sutherland -- about
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brooks brothers and brooks and it will involve brooke sutherland as well. that is next and this is bloomberg. ♪
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viviana: this is "bloomberg daybreak." i'm viviana hurtado with your bloomberg business flash. buyersn with potential looking at marathon petroleum speedway gas station chain. bloomberg has learned the deal could stretch more than $20 billion. among those interested, the japanese company that controls the 7-eleven chain and a private equity firm. bitcoin has appears to have decisively breached $10,000 for the first time since september. the digital currency rising for its longest rally since june. now buyers are setting their sites at the next resistance levels.
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whond with nissan reportedly may post its first quarterly loss in 10 years. the reason? a drop in sales. production shortages due to the coronavirus is may also be a factor. i'm viviana hurtado and that is your bloomberg business flash. romaine: time for the bottom line where we take a look at three companies watching -- worth watching. i am watching bed, bath & beyond. you might want to look away. shares down almost 26%. if this carries into the trading day this with the worst day for the company on record. they came out and gave a preliminary update for the month of december and the month of january, the first two months of their fourth quarter. it was not good. comp sales are down 5.4%. you have some analysts saying the turnaround story does not exist. that might be unfair. they just got a new ceo. rough holiday a
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season for a lot of retailers. i am sticking with retail and taking a look at brooks brothers, not to be confused with my own name, this does not have an e on the end, but there is a dispute about the name. brooks brothers is trying to trademark the name brooks to put on sportswear. but there is another brooks shoe company owned by warren buffett. they have a truce on the trademark and now brooks brothers is trying to ditch the brothers and call itself brooks and we have a lawsuit. it will be interesting to see what happens. romaine: are you going to join the lawsuit? brooke: i should. we will cl them brooks sisters. let's turn to the semiconductor space. anan, the sox was up a couple of
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percent, we had chip stocks. there seems to be a sense that whatever bottom people were looking for, we may have found it. inn: we had a tough year 2019. the pce segment was the only thing that was working and stocks were looking forward to a better 2020 and started rebounding in the later part of the year. particular with the cloud stream coming back. this year we have five g, we pricesndsets plateauing, going up, more content within meh butandsets, pcs are they are not cratering, and you have the cloud stream coming back. net-net, if you look at semiconductors as a whole, it is poised forarninggrowth in 2020. even memory was supposed to find stability and second-half balance, but the coronavirus is throwing a wrench into the
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works, potentially making the first half much weaker and potentially causing strength to come back in the second half. that is what we are hoping. romaine: when we talk about the first being weaker, some say that will be made up, the demand is there, it will just be delayed. anand: absolutely. the risk for me is not q1. nothing good happens in q1. you have the lunar new year, which also affects sales, etc.. then we start spilling over into q2 and that potentially affecting the all-important q3, which is the quarter for semis. then we are in a sticky wicket because we cannot wake up any weakness with other quarters. brooke: are we really looking for a demand recovery or is it just going off the low levels in 2019 and recovering from that baseline? anand: a combination of both.
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if you look at autos and industrials, you are looking for recovery from the baseline. auto sales in china down 8%. that is a good thing. will for pell growth -- will propel growth for that segment. on the other hand, we are looking for oomph driven by 5g handsets, much higher content, good for semis. then memory, we are looking for a supply/demand balance which will drive prices and the revenue of that industry. and cloud, i would be remiss if i did not mention the cloud. cloud strength, amazon, facebook, microsoft google. romaine: such a font of knowledge. thank you very much. and a special thanks to brooke sutherland of bloomberg opinion. i will keep an eye out for your leisure line. brooke: i will drop the plant
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and come up with some yoga plants -- with some yoga pants. romaine: coming up, we look at what is moving microsoft shares. that is coming up next in today's technically speaking. if you're jumping at your car, tune into bloomberg radio on sirius xm channel 119 and on the bloomberg business app. from new york, this is bloomberg. ♪
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romaine: we are here with bill maloney. he is the voice of bloomberg equity squad. you can listen to bill on the terminal by typing in squa on the terminal. what you have today? let's start with microsoft. bill: they did selloff yesterday. up around 1% in the premarket. gains have accelerated since the january lows, but interesting action yesterday from what is called the candlestick dark cloud cover.
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had a big run up on monday to a record, then hit a new record high yesterday, hitting 197, then it sold off part, closing at 184. yesterday's high may be the short-term top of the stock, at least for now. romaine: we will see if microsoft can get a recovery after yesterday's selloff. another stock that has been doing well as amazon. bill: we talked briefly amazon on monday how it broke out above this long-term resistance level. gains have accelerated since it did break out, up 13 or 14 points in the premarket. 2170, then you want to look at 2186, which is yesterday's high. 2170 is the first level you want to look at for amazon. romaine: we will keep an ion that. one company i always keep an eye on his cbs health. -- cvs health. bill: up 2.7% in the premarket.
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did have a drop after the earnings result. off 75. the stock is had a big move off of the 2019 lows. it will try to break this long-term downtrend. the first level you want to watch is the retracement level of 75. if it gets above that, maybe 83 or so. 75 is your first level. romaine: bill maloney with all of our technical indicators. our thanks to him. that does it for me. stay tuned. "the open" with jonathan ferro is coming up next. emily rowland of john hancock investment. from new york, this is bloomberg. ♪
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jonathan: from new york city for our audience worldwide. i'm jonathan ferro. "the countdown to the open" starts right now. ♪ jonathan: coming up on the program, equity markets climbing a wall of worry to record highs. hillowell's day on capitol
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, and senator sanders on top. democratic moderates squeezing each other out. with 30 minutes until the opening bal, good morning. here is your wednesday morning price action. equities advance .4% on the s&p 500. all-time highs after the record highs and we are expecting to add weight to that after the open. treasury yields a couple of basis points higher to 1.62. the euro a little bit weaker, sitting right on top of 1.09. senator sanders coming out on top in new hampshire. a tight finish, leaving the best of the rest to take him in nevada. beginningctory is the of the end for donald trump. >> we will be donald trump. >> we might be headed for another one of those long primary figh

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